US wheat futures fell on Friday, with the benchmark Chicago Board of Trade soft red winter wheat contract hitting its lowest level in more than four months as traders said the market was technically weak following a string of declines. For the week, the CBOT December soft red winter wheat contract was 5.5 percent lower, its biggest weekly loss since early June.
CBOT wheat has fallen for six days in a row its longest losing streak of the year. The front-month contract has shed 7.2 percent of its value during that time. The US Agriculture Department said on Friday morning that weekly export sales of wheat were 314,600 tonnes, in line with forecasts for 250,000 to 450,000 tonnes and up from 220,900 tonnes a week ago.
Dry weather remains an issue in the US Plains hard red winter wheat region and no relief is in sight, said Andy Karst meteorologist for World Weather Inc. Chicago Board of Trade corn futures were higher on short-covering amid oversold technicals and following news the EPA would uphold an ethanol mandate, traders said. "I think we exhausted the selling that started after the USDA report. We've taken it down hard after the report and it was oversold so there was short-covering before the weekend. I don't see anything new fundamentally," a trader said.
The United States decided on Friday to hold in place its mandate to add corn ethanol to motor fuel despite reduced corn production, arguing that the policy does not cause undue economic harm. USDA on Friday said net export sales of US corn last week totalled 312,000 tonnes, within the range of estimates for 200,000 to 400,000 tonnes. Analysts were expecting USDA's cattle on feed report on Friday to show US cattle placements in October at 2.178 million head, down 12.6 percent from a year ago and the lowest in 16 years due to high feed costs.
Corn spot basis bids were steady to higher at processing plants around the US Midwest on Friday and ethanol plants also upped their bids. Cash basis found support from slow farmer offerings as the US harvest drew to a close. Overall satisfactory crop weather continues in most of South America with the exception of some flooding in portions of Argentina and pockets of dryness in north-west Brazil, said Andy Karst, meteorologist for World Weather Inc.
Key resistance for December is at the 50-day moving average of $7.47-1/4 and key support is at the 200-day moving average of $6.54. The nine-day relative strength index is at 41. US soyabean futures dropped 1.3 percent to a five-month low after the world's top importer of the oilseed cancelled deals to import some US supplies, traders said.
For the week, the benchmark Chicago Board of Trade January soyabean futures contract dropped 4.7 percent, its third straight week of declines. During the past three weeks, soyabean prices have shed 11.4 percent. The front-month soyabean contract hit a low of $13.72-1/4 during Friday's session, its lowest level since June 15. Chinese importers cancelled orders for about 600,000 tonnes of US soyabeans due to weak domestic demand and recent price declines, the China National Grain and Oils Information Centre said. The US Agriculture Department said on Friday morning that weekly export sales of soyabeans were 585,200 tonnes, topping forecasts for 250,000 to 550,000 tonnes and up from 191,900 tonnes a week ago.